Shell Marine Products (US) Co. will receive a big – and potentially huge – contract to provide lubricants and related services to the agency that supplies American armed forces around the world, the U.S. Department of Defense announced Friday.
The contract, awarded by the Navys Military Sealift Command, calls for an $8.6 million payout the first year. It also includes four one-year renewal options that, if exercised, would bring the total value to $46.5 million.
The MSC, which is headquartered in Washington, D.C., provides ocean transportation of equipment, fuel, supplies and ammunition to U.S. forces during peacetime and at war. According to the command, more than 95 percent of equipment and supplies used by American forces during war are delivered by sea.
The Department of Defense said Shell will supply lubricants, waste oil disposal services and related engineering support services to MSC. A spokesman for the command said it does not discuss specifics of where Shell will be working. Shell declined to comment.
In its announcement, the Department of Defense said the contract was competitively procured, with three offers received. The MSC spokesman told Lube Report that ExxonMobil held the contract until the most recent round of bidding. ExxonMobil Lubricants and Petroleum Specialties recently landed another big military contract. According to Mondays edition of the Washington Post, the U.S. Defense Logistics Agency gave the company a $1 million contract for fuels, lubricants, oils and waxes.